Description

Australia Information Technology Report Q2 2016 Description

BMI View: Australia's IT market is forecast to increase at a CAGR of 4.4% over 2016-2020 to AUD46.6bnin 2020, with software and services segments set to outperform. We expect cloud computing availability willsee spending tick higher, while there are major opportunities for Internet of Things solutions, and webelieve Australia could prove an early adopter of cognitive computing solutions due to its high labour costsin a low-cost region. Demand growth will be weaker in the hardware segment, where saturation acrossdevice categories means there is little low-hanging fruit for vendors - but the PC market is still attractive asit is highly lucrative in per capita terms with a strong bias towards premium devices.

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Computer Hardware Sales: AUD7.8bn in 2016 to AUD8.4bn in 2020. Tablet volume volatility derivedfrom the steep diffusion curve will stabilise over the medium term and put the overall market back onto amore stable trajectory based on replacement demand, but overall growth rates will be modest due tomaturity.

Software Sales: AUD9.4bn in 2016 to AUD11.0bn in 2020. Data analytics software seeing strongdemand, while application demand from small- and medium-sized enterprises should be driven higher byavailability of software-as-a-service solutions.

IT Services Sales: AUD22.0bn in 2016 to AUD27.2bn in 2020. IT services will be the fastest growtharea of the IT market over the medium term, with cloud services the key growth driver, and potential forInternet of Things and cognitive computing solutions to gain traction due to Australia's high labour costs.